The Registered Disability Savings Plan (RDSP) is a Canada-wide registered matched savings plan specifically for Canadians with disabilities.
Here are some basics:
- For every $1 put in an RDSP account, the federal government can (if your family income is below $87,123) match with up to $3! This is the Canada Disability Savings Grant.
- For people living on a low-income (less than $25,356), the federal government will put in $1000 each year for 20 years! This is the Canada Disability Savings Bond.
- For people living on an income between $25,356 – $43,561, they can still receive a partial bond.
- Anyone can contribute to someone’s RDSP (friends, neighbours, family members, etc). It gives people who want to help a way to do so!
- There is a lifetime contribution limit of $200,000, which can be made up of a few large payments or a series of small ones.
- People with disabilities can choose what to do with the money when it comes out – there are no restrictions on how the money can be spent!
The RDSP is exempt from most provincial disability and income assistance benefits. It does not get clawed back and it does not reduce disability benefits payments.
If the parents of a baby born with a disability today contribute $1,500 a year to her RDSP for the next twenty years, the combination of matching grants, savings bond and compound interest will see her RDSP grow to about $250,000 by her thirtieth birthday. If she doesn’t withdraw it all at once, her RDSP will become worth more than half a million dollars over her lifetime.
That’s based on a total family contribution over twenty years of $30,000, or a little more than four dollars a day – the cost of a Tim Horton’s double-double and a doughnut.
For more information on the RDSP visit rdsp.com